As digital transformation becomes increasingly important for enterprises to thrive in the digital economy, telecoms carriers can play a key role in accelerating digital transformation further, unlocking new energy for data-driven growth, and exploring new engines for digital intelligence.
That was the key message at the Operations Transformation Forum (OTF) on October 26-27 in Bangkok, organized by Huawei, who also unveiled its ‘Digital Operation Transformation Digiverse 2.0’ to help telcos further unlock transformation value and contribute to developing the digital economy.
Digital economy as growth engine
It’s already been established that the COVID-19 pandemic was a key accelerator of digital services, which in turn became an accelerator of digitalization initiatives around the world as enterprises scrambled to keep up with customer demand and enable employees to work from home. McKinsey says the pandemic has greatly accelerated the digitalization process of enterprises, which will be brought forward by seven years
However, the rise of digital has even greater implications. As the World Bank projects a global 2.9% GDP decline this year, Roland Berger notes that the digital economy growth rate was twice than the traditional economy on average. In other words, the digital economy has become a crucial engine of economic development in many countries.
Meanwhile, with extreme climate disasters increasing 83% in the last 20 years and energy prices surged this year, digital intelligence technology promises lower carbon emissions and power consumption.
In other words, the global economic slowdown, COVID-19, and the energy and environmental crisis have created tremendous challenges. Despite all these uncertainties, one thing is certain: the trend towards digitalization has not changed. But while digitalization has made some companies better, today it’s the key to their survival. Only digital intelligent companies will survive well in the future.
The digital economy in 2030
That future is also going to see a lot of breakthroughs in connectivity, computing, awareness, and interaction technologies – as well as a massive amount of data usage.
According to a Huawei report, “The 2030 Digital Intelligence World“, average handset data traffic per user per month (DOU) will reach 600 GB by 2030, while 10GE home broadband penetration rate will reach 23%.
That will be driven by everything from wearables, AR and 3D to holographic communication technologies, digital catalogues and automatic delivery. On the enterprise side, robots will be more commonplace, and the supply chain will become visible and meshed under the influence of digitalization.
The rapid development of towards the digital economy of 2030 will bring plenty of opportunities to telecoms carriers – but it will also bring significantly more complexity to their services and networks.
To cope with the challenges, the telecoms industry needs to think about how carriers can evolve, upgrade, and adapt to the digital intelligence future.
Three upgrades for carriers
At the summit, carriers were recommended to pay attention to two things:
- How to implement digital intelligence for core services to optimize costs and experience and perform value-based operations for existing users.
- How to explore the new track of services based on differentiated capabilities to ensure new growth engines in the future.
To that end, carriers should implement three upgrades to keep pace: business upgrade, O&M upgrade and standards upgrade.
The business upgrade means creating new offerings based on carriers’ existing secure & native connection capabilities for existing user groups, the difference being to obtain new experience, new scenarios, and new customer values through the ‘connection plus X’ mode.
The key to O&M upgrade is man-machine collaboration to provide intelligent O&M. And the standards upgrade requires building a set of digital operational maturity standards that everyone can agree on to effectively measure value, identify gaps, and set goals and approaches.
Unlocking further value from digital transformation
Carriers will also need to rethink their approach to digital transformation if they want to successfully unlock more value from it to meet the needs of the digital economy.
For a start, said Jacky Zhou, President of Huawei Service and Software Solution Marketing, in his keynote talk, the motive behind transformation needs to be business-driven, not just technology-driven.
“Most of the time, when we talk about digital transformation, we usually understand it be driven by AI, big data, and cloud platforms,” Zhou explained. “However, these are just digital technologies, and transformation needs to be driven by both technology and business. That means being customer centric, creating business value, and using business architecture to guide the technical architecture.”
Carriers also need to rethink their transformation pathway. Up to now, digital transformation initiatives have been incremental and focused on a single scenario – address a specific pain point, fix it and move on to the next one. Zhou said the time has now come for operators to look at these as a series of scenarios to achieve sustainable business growth.
“As more scenarios are selected, data and digital capabilities accumulate on the platform, mining more converged data value, and collaboration value across different scenarios, which in turn allows the transformation to scale to more scenarios.”
How carriers should evaluate value
Finally, carriers need to rethink how they evaluate the value of transformation. In the past, the focus was only on the commercial outcome (e.g. the ROI). But Zhou argued that the value of digital transformation should be considered from the sum of three value categories:
- Capability value: differentiated application, data quality, cloud maturity, and digital talent ratio. “This provides fertile soil for carriers and build a solid foundation,” Zhou said.
- Service value: marketing success rate, service quality, network reliability, service rollout time, and automation degree. This helps carriers build high-quality and efficient services.
- Business value: customer satisfaction, revenue and marginal effect, and reduced O&M costs.
“Based on this three-layer value model, the value of carriers’ transformation will help carriers focus on digital transformation and move towards the final business value,” Zhou said.
Digital Operation Transformation Digiverse 2.0
To help carriers with all this, Zhou said, Huawei has upgraded its best methods and practices outlined in ‘Digital Operation Transformation 1.0’. The newly launched ‘Digital Operation Transformation Digiverse 2.0’ promises to help carriers further unlock transformation value by offering four significant improvements.
First, carriers should convert clean data to smart data, and combine AI and cloud platforms, to achieve “smart data” and release more potential data value.
Second, the digital platform should be integrated to a cloud native, service-driven, and hybrid cloud, after which carriers can take full advantage of the advantages of different types of clouds based on the principle of core asset security and application efficiency.
Third, carriers should shift from single-scenario to cross-scenario collaboration. Service network collaboration brings agile service development to the CMO, while experience and O&M collaboration brings closed-loop experience operation across scenarios.
Fourth: carriers can extend ToC (To Consumer) and ToH (To Home)to enable digital transformation in ToB (To Business) industries, which will provide new revenue opportunities.
“Digital operations transformation is a systematic project, which cannot be done overnight. But by remaining customer centric, creating business value, and keeping going, I am confident that together we will achieve greater success,” Zhou said.
To learn more about Operations Transformation Forum 2022, please click here.